Defend against bankruptcy preference actions with strategies like contemporaneous exchange, ordinary course of business, and subsequent new value defenses.

Many but not all states permit a company to commence an ABC to liquidate all its assets for the benefit of its creditors. The ULC is currently working to create a uniform act on the subject.

Does a law firm in bankruptcy have rights to former client profits? The trend with the ‘Unfinished Business’ Doctrine and Jewel Waiver has answers.

Author’s Note Appellate rulings in a California bankruptcy case have the potential to upend a bedrock principle of Subchapter V plans. After an apparel company filed for Chapter 11 under Subchapter V because of a judgment it could not pay, its plan to reorganize has bounced between bankruptcy court and the district court since 2020. While the bankruptcy court supports the debtor’s use of Subchapter V’s unique provisions favoring debtors and equity holders, the district court has taken a more creditor-centric view and blocked its plan twice. While thousands of […]

When Corporate Attorney-Client Communication Is No Longer a Secret Imagine if every secret and strategy that you had ever shared with your attorney were laid open for the world to see. A trustee in a business bankruptcy case may well have the power to review, publish, and wield all of the debtor’s attorney-client communication, including those communications that the debtor’s principals reasonably believed were permanently encased in a fortress of secrecy. The trustee can thus gain major ammunition for claims against insiders, business partners, vendors, attorneys, accountants, advisors, and others. […]

Assessing Legal Risk    “One man’s rubbish is another man’s treasure.” -William & Robert Chambers Journal of Popular Literature, Science and Arts (1879)  “A little learning is a dangerous thing” -Alexander Pope, An Essay on Criticism (1709)    Purchasing operating assets from a financially distressed seller is a fantastic opportunity to buy low. Before doing so, however, any buyer must take into account a host of considerations, including, but not limited to, operational, competitive, integration, and legal issues, such as fraudulent transfers and successor liability. Buying a business, or business […]

Creditors looking to pursue a collections action should understand how Chapter 7 and Chapter 13 bankruptcy processes can affect efforts to collect.

LLCs protect individuals from company liabilities, but a Chapter 7 Bankruptcy Trustee can reach assets to satisfy individual obligations. 

The Sixth Circuit would quote Ohio case law to explain that “A contract of novation is created where a previous valid obligation is extinguished by a new valid contract, with the consent of all the parties, and based on valid consideration.” In a sense, a novation establishes that the prior contract is fully performed by the novated contract.

Is the company that you work for struggling? Find out what this means for an employee who is working for a struggling business that may file for bankruptcy.